[Federal Register Volume 67, Number 55 (Thursday, March 21, 2002)]
[Rules and Regulations]
[Pages 13084-13089]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-6835]


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DEPARTMENT OF AGRICULTURE

Grain Inspection, Packers and Stockyards Administration

7 CFR Part 800

[Docket No. FGIS-2001-003a]
RIN 0580-AA79


Fees for Official Inspection and Official Weighing Services

AGENCY: Grain Inspection, Packers and Stockyards Administration, USDA.

ACTION: Final rule.

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SUMMARY: The Federal Grain Inspection Service (FGIS) of the Grain 
Inspection, Packers and Stockyards Administration (GIPSA) is increasing 
certain fees by approximately 4.6 percent; i.e., contract and non-
contract hourly rates, certain unit rates, and the administrative 
tonnage fee. These fees apply only to official inspection and weighing 
services performed by GIPSA in the United States under the United 
States Grain Standards Act (USGSA), as amended. These increases are 
needed to cover increased operational costs resulting from the 
approximate 4.6 percent January 2002 Federal pay increase. GIPSA 
anticipates the increase in the user fees will generate approximately 
$703,000 in additional revenue.

[[Page 13085]]


EFFECTIVE DATE: April 22, 2002.

FOR FURTHER INFORMATION CONTACT: David Orr, Director, Field Management 
Division, at his E-mail address: [email protected], or telephone 
him at (202) 720-0228.

SUPPLEMENTARY INFORMATION:

Executive Order 12866, Regulatory Flexibility Act, and the 
Paperwork Reduction Act

    This rule has been determined to be nonsignificant for the purpose 
of Executive Order 12866 and, therefore, has not been reviewed by the 
Office of Management and Budget.
    Also, pursuant to the requirements set forth in the Regulatory 
Flexibility Act, it has been determined that this final rule will not 
have a significant economic impact on a substantial number of small 
entities as defined in the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.).
    GIPSA regularly reviews its user-fee-financed programs to determine 
if the fees are adequate. GIPSA has and will continue to seek out cost 
saving opportunities and implement appropriate changes to reduce costs. 
Such actions can provide alternatives to fee increases. However, even 
with these efforts, GIPSA's existing fee schedule will not generate 
sufficient revenues to cover program costs while maintaining an 
adequate reserve balance. Retained earnings balances are adjusted to 
reflect prior year revenue and obligations realized in the year 
reported. In FY 1999, GIPSA's operating costs were $23,176,643 with 
revenue of $22,971,204, resulting in a negative margin of $205,440. In 
FY 2000, GIPSA's operating costs were $24,146,428 with revenue of 
$23,150,188 that resulted in a negative margin of $996,240 and a 
negative reserve balance of $938,147. GIPSA's FY 2001 operating costs 
were $25,670,126 with revenue of $23,977,240 that resulted in a 
negative margin of $1,692,886. Using the most current financial data 
available for FY 2002, December 2001, GIPSA's operating costs were 
$6,923,247 with revenue of $7,131,883 that resulted in a positive 
margin of $208,247. However, the current reserve negative balance of 
$2,882,270 is well below the desired 3-month reserve of approximately 
$6 million. Employee salaries and benefits are major program costs that 
account for approximately 84 percent of GIPSA's total operating budget. 
The approximate general and locality salary increase averages 4.6 
percent for GIPSA employees, effective January 2002, will increase 
GIPSA's costs by approximately $703,000.
    GIPSA has reviewed the financial position of the inspection and 
weighing program based on the increased salary and benefit costs, along 
with the revised projected FY 2002 workload of 79 million metric tons. 
Based on the review, GIPSA has concluded that the approximate 4.6 
percent salary increase will have to be recovered through increases in 
fees.
    The fee increase primarily applies to entities engaged in the 
export of grain. Under the provisions of the USGSA, grain exported from 
the United States must be officially inspected and weighed. Mandatory 
inspection and weighing services are provided by GIPSA on a fee basis 
at 32 export facilities. All of these facilities are owned and managed 
by multi-national corporations, large cooperatives, or public entities 
that do not meet the criteria for small entities established by the 
Small Business Administration.
    Some entities that request nonmandatory official inspection and 
weighing services at other than export locations could be considered 
small entities. The impact on these small businesses is similar to any 
other business; that is, an average 4.6 percent increase in the cost of 
official inspection and weighing services. This increase should not 
significantly affect any business requesting official inspection and 
weighing services. Furthermore, any of these small businesses that wish 
to avoid the fee increase may elect to do so by using an alternative 
source for inspection and weighing services. Such a decision should not 
prevent the business from marketing its products.
    There would be no additional reporting or recordkeeping 
requirements imposed by this action. In compliance with the Paperwork 
Reduction Act of 1995 (44 U.S.C. Chapter 35), the information 
collection and recordkeeping requirements in Part 800 have been 
previously approved by the Office of Management and Budget under 
control number 0580-0013. GIPSA has not identified any other Federal 
rules which may duplicate, overlap, or conflict with this final rule.

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This action is not intended to have a retroactive 
effect. The USGSA provides in Sec. 87g that no subdivision may require 
or impose any requirements or restrictions concerning the inspection, 
weighing, or description of grain under the Act. Otherwise, this final 
rule will not preempt any State or local laws, regulations, or policies 
unless they present irreconcilable conflict with this final rule. There 
are no administrative procedures that must be exhausted prior to any 
judicial challenge to the provisions of this final rule.

Background

    On January 2, 2002, GIPSA proposed in the Federal Register (67FR25) 
to increase fees for official inspection and weighing services 
performed under the USGSA (7 U.S.C. 71 et seq.) by approximately 4.6 
percent. The USGSA authorizes GIPSA to provide official grain 
inspection and weighing services and to charge and collect reasonable 
fees for performing these services. The fees collected are to cover, as 
nearly as practicable, GIPSA's costs for performing these services, 
including related administrative and supervisory costs. The current 
USGSA fees were published in the Federal Register on July 9, 2001 (66 
FR 35751), and became effective on August 8, 2001. GIPSA regularly 
reviews its user-fee-financed programs to determine if the fees are 
adequate. GIPSA has and will continue to seek out cost-saving 
opportunities and implement appropriate changes to reduce costs. Such 
actions can provide alternatives to fee increases. However, even with 
these efforts, GIPSA's existing fee schedule will not generate 
sufficient revenues to cover program costs while maintaining an 
adequate reserve balance. Retained earnings balances are adjusted to 
reflect prior year revenue and obligations realized in the year 
reported. In FY 1999, GIPSA's operating costs were $23,176,643 with 
revenue of $22,971,204, resulting in a negative margin of $205,440. In 
FY 2000, GIPSA's operating costs were $24,146,428 with revenue of 
$23,150,188 that resulted in a negative margin of $996,240 and a 
negative reserve balance of $938,147. GIPSA's FY 2001 operating costs 
were $25,670,126 with revenue of $23,977,240 that resulted in a 
negative margin of $1,692,886. Using the most current financial data 
available for FY 2002, December 2001, GIPSA's operating costs were 
$6,923,247 with revenue of $7,131,883 that resulted in a positive 
margin of $208,247. However, the current reserve negative balance of 
$2,882,270 is well below the desired 3-month reserve of approximately 
$6 million. Employee salaries and benefits costs, which account for 
approximately 84 percent of GIPSA's total operating budget, have risen 
significantly over the years. GIPSA's average cost per hour in FY 1996 
was $20.83 and has risen to $26.60 in FY 2001, a 27.7 percent

[[Page 13086]]

increase. Since FY 1996, GIPSA has increased fees six times to recover 
the Congressionally mandated salary increases each year as well as 
other pay and benefit increases such as longevity pay. The six fee 
increases have raised fees by approximately 22 percent over the FY 1996 
levels.
    While individual salary and benefit costs have increased since 
1996, GIPSA has reduced overall salary and benefits costs by 12.8 
percent through greater utilization of part-time and intermittent 
employees and improved program efficiencies. GIPSA has also reduced 
non-employee costs such as rent, utilities, and Departmental overhead 
by 1.4 percent.
    The January 2002 salary increase averaged 4.6 percent for GIPSA 
employees, which equates to an estimated $703,000 increase. GIPSA has 
reviewed the financial position of the inspection and weighing program 
and concluded that fee increases are necessary to recover the estimated 
$703,000 increase in program costs. An average increase of 4.6 percent 
to hourly, certain unit fees, and the administrative tonnage fee is 
needed.
    The current hourly fees are:

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                                                               Monday to    Monday to
                                                               Friday (6    Friday (6    Saturday,
                                                               a.m. to 6    p.m. to 6   Sunday, and    Holidays
                                                                 p.m.)        a.m.)       Overtime
----------------------------------------------------------------------------------------------------------------
1-year contract.............................................       $27.40       $29.80       $38.60       $46.40
6-month contract............................................        30.20        32.00        41.00        53.00
3-month contract............................................        34.40        35.60        44.60        55.40
Non-contract................................................        40.00        42.00        51.00        62.60
----------------------------------------------------------------------------------------------------------------

    GIPSA has also identified certain unit fees, for services not 
performed at an applicant's facility, which contain direct labor costs 
and require a fee increase. Further, GIPSA has identified those costs 
associated with salaries and benefits that are covered by the 
administrative metric tonnage fee. The 4.6 percent cost-of-living 
increase to salaries and benefits covered by the administrative tonnage 
fee results in an overall increase of an average of 4.6 percent to the 
administrative tonnage fee.

Comment Review

    GIPSA received 1 comment during the 30-day comment period from a 
grain trade association. The trade association stated that it consists 
of 1,000 grain, feed, processing, and grain-related companies, 70 
percent of which are small entities. The commentor did not support the 
proposed rule. A summary of the comment and GIPSA's response is as 
follows:
    The commentor opposed the fee increase and suggested that the 
proposed fee increase be offset through improved operating efficiencies 
and additional reductions in overhead. In addition, the commentor 
suggested GIPSA aggressively seek ways to reduce direct employee 
expenses through increased automation and contracting for official 
services so future mandated Federal pay increases will have less impact 
on the cost of providing official services. The commentor also stated 
that the agency should determine what programs could be terminated, 
scaled back, or consolidated to reduce administrative overhead.
    The USGSA requires GIPSA to maintain a workforce of sufficient size 
and experience to meet the inspection and weighing needs of its 
applicants. GIPSA views its employees as valuable resources that 
facilitate the marketing of grain. Whenever possible, GIPSA has 
replaced vacant full-time permanent positions with part-time and 
intermittent employees to reduce administrative overhead costs related 
to employee salaries and benefits. Since FY 1996, GIPSA has decreased 
headquarters paid hours of overhead by 14.44 percent and other 
obligations by 1.4 percent. However, these reductions have not been 
enough to offset the increases in salaries and benefits. Further, GIPSA 
is constantly reviewing the inspection and weighing programs to assess 
service delivery and demand. Whenever, possible, available employees 
are used for temporary duty assignments within other Federal programs 
to further reduce administrative overhead costs. This action allows 
GIPSA the ability to temporarily downsize while maintaining an 
experienced workforce available for duty when service demands increase. 
GIPSA is continuing to review the issue of contracting for official 
services when appropriate. Efforts to contain and reduce costs have and 
will continue to be a high priority issue with GIPSA. GIPSA has and 
will continue to take action to reduce inspection and weighing costs 
whenever possible.

Final Action

    Accordingly, GIPSA is applying an approximate 4.6 percent increase 
to certain hourly rates, certain unit rates, and the administrative 
tonnage fee, as proposed in 7 CFR 800.71: Table 1-Fees for Official 
Services Performed at an Applicant's Facility in an Onsite FGIS 
Laboratory; Table 2-Services Performed at Other Than an Applicant's 
Facility in an FGIS Laboratory; and Table 3, Miscellaneous Services.

List of Subjects in 7 CFR Part 800

    Administrative practice and procedure, Grain.

    For the reasons set out in the preamble, 7 CFR Part 800 is amended 
as follows:

PART 800--GENERAL REGULATIONS

    1. The authority citation for part 800 continues to read as 
follows:

    Authority: Pub. L. 94-582, 90 Stat. 2867, as amended (7 U.S.C. 
71 et seq.)
    2. Section 800.71 is amended by revising Schedule A in paragraph 
(a) to read as follows:


Sec. 800.71  Fees assessed by the Service.

    (a) * * *

[[Page 13087]]

Schedule A.--Fees for Official Inspection and Weighing Services 
Performed in the United States

    Table 1.--Fees for Official Services Performed at an Applicant's Facility in an Onsite FGIS Laboratory\1\
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                                                               Monday to    Monday to
                                                               Friday  (6   Friday  (6   Saturday,
                                                               a.m. to 6    p.m. to 6   Sunday, and    Holidays
                                                                 p.m.)        a.m.)     overtime\2\
----------------------------------------------------------------------------------------------------------------
(1) Inspection and Weighing Services Hourly Rates (per
 service representative)
  1-year contract...........................................       $28.60       $31.20       $40.40       $48.60
  6-month contract..........................................        31.60        33.40        42.80        56.00
  3-month contract..........................................        36.00        37.20        46.60        58.00
  Non-contract..............................................        41.80        44.00        53.40        65.40


(2) Additional Tests (cost per test, assessed in addition
 to the hourly rate) \3\
    (i) Aflatoxin (other than Thin Layer Chromatography)...        $8.50
    (ii) Aflatoxin (Thin Layer Chromatography method)......        20.00
    (iii) Corn oil, protein, and starch (one or any                 1.50
     combination)..........................................
    (iv) Soybean protein and oil (one or both).............         1.50
    (v) Wheat protein (per test)...........................         1.50
    (vi) Sunflower oil (per test)..........................         1.50
    (vii) Vomitoxin (qualitative)..........................        12.50
    (viii) Vomitoxin (quantitative)........................        18.50
    (ix) Waxy corn (per test)..............................         1.50
    (x) Fees for other tests not listed above will be based
     on the lowest noncontract hourly rate.
    (xi) Other services
        (a) Class Y Weighing (per carrier)
            (1) Truck/container............................          .30
            (2) Railcar....................................         1.25
            (3) Barge......................................         2.50
(3) Administrative Fee (assessed in addition to all other
 applicable fees, only one administrative fee will be
 assessed when inspection and weighing services are
 performed on the same carrier).
    (i) All outbound carriers (per-metric-ton) \4\
        (a) 1-1,000,000....................................      $0.1152
        (b) 1,000,001-1,500,000............................       0.1051
        (c) 1,500,001-2,000,000............................       0.0568
        (d) 2,000,001-5,000,000............................       0.0420
        (e) 5,000,001-7,000,000............................       0.0230
        (f) 7,000,001 +....................................      0.0105
\1\ Fees apply to original inspection and weighing, reinspection, and
  appeal inspection service and include, but are not limited to,
  sampling, grading, weighing, prior to loading stowage examinations,
  and certifying results performed within 25 miles of an employee's
  assigned duty station. Travel and related expenses will be charged for
  service outside 25 miles as found in Sec.  800.72 (a).
\2\ Overtime rates will be assessed for all hours in excess of 8
  consecutive hours that result from an applicant scheduling or
  requesting service beyond 8 hours, or if requests for additional
  shifts exceed existing staffing.
\3\ Appeal and reinspection services will be assessed the same fee as
  the original inspection service.
\4\ The administrative fee is assessed on an accumulated basis beginning
  at the start of the Service's fiscal year (October 1 each year).


Table 2.--Services Performed at Other Than an Applicant's Facility in an
                         FGIS Laboratory\1\ \2\
------------------------------------------------------------------------
 
------------------------------------------------------------------------
(1) Original Inspection and Weighing (Class X) Services
    (i) Sampling only (use hourly rates from Table 1)
    (ii) Stationary lots (sampling, grade/factor, &
     checkloading)
        (a) Truck/trailer/container (per carrier)..........       $19.25
        (b) Railcar (per carrier)..........................        28.90
        (c) Barge (per carrier)............................       185.00
        (d) Sacked grain (per hour per service                      0.02
         representative plus an administrative fee per
         hundredweight) (CWT)..............................
    (iii) Lots sampled online during loading (sampling
     charge under (i) above, plus):
        (a) Truck/trailer container (per carrier)..........         9.95
        (b) Railcar (per carrier)..........................        19.25
        (c) Barge (per carrier)............................       110.00
        (d) Sacked grain (per hour per service                      0.02
         representative plus an administrative fee per
         hundredweight) (CWT)..............................
    (iv) Other services
        (a) Submitted sample (per sample--grade and factor)        11.50
        (b) Warehouseman inspection (per sample)...........        19.50
        (c) Factor only (per factor--maximum 2 factors)....         5.15
        (d) Checkloading/condition examination (use hourly          0.02
         rates from Table 1, plus an administrative fee per
         hundredweight if not previously assessed) (CWT)...
        (e) Reinspection (grade and factor only. Sampling          12.80
         service additional, item (i) above)...............
        (f) Class X Weighing (per hour per service                 55.00
         representative)...................................
    (v) Additional tests (excludes sampling)
        (a) Aflatoxin (per test--other than TLC method)....        29.00
        (b) Aflatoxin (per test--TLC method)...............       110.00
        (c) Corn oil, protein, and starch (one or any               8.80
         combination)......................................
        (d) Soybean protein and oil (one or both)..........         8.80
        (e) Wheat protein (per test).......................         8.80

[[Page 13088]]

 
        (f) Sunflower oil (per test).......................         8.80
        (g) Vomitoxin (qualitative)........................        30.50
        (h) Vomitoxin (quantitative).......................        37.50
        (i) Waxy corn (per test)...........................        10.00
        (j) Canola (per test--00 dip test).................        10.00
        (k) Pesticide Residue Testing \3\..................
            (1) Routine Compounds (per sample).............       210.00
            (2) Special Compounds (per service                    110.00
             representative)...............................
        (l) Fees for other tests not listed above will be
         based on the lowest noncontract hourly rate from
         Table 1...........................................
(2) Appeal inspection and review of weighing service.\4\
    (i) Board Appeals and Appeals (grade and factor).......        79.50
        (a) Factor only (per factor--max 2 factors)........        41.80
        (b) Sampling service for Appeals additional (hourly
         rates from Table 1)...............................
    (ii) Additional tests (assessed in addition to all
     other applicable fees)
        (a) Aflatoxin (per test, other than TLC)...........        29.50
        (b) Aflatoxin (TLC)................................       118.00
        (c) Corn oil, protein, and starch (one or any              16.80
         combination)......................................
        (d) Soybean protein and oil (one or both)..........        16.80
        (e) Wheat protein (per test).......................        16.80
        (f) Sunflower oil (per test).......................        16.80
        (g) Vomitoxin (per test--qualitative)..............        40.00
        (h) Vomitoxin (per test--quantitative).............        45.00
        (i) Vomitoxin (per test--HPLC Board Appeal)........       136.00
        (j) Pesticide Residue Testing\3\...................
            (1) Routine Compounds (per sample).............       210.00
            (2) Special Compounds (per service                    110.00
             representative)...............................
        (k) Fees for other tests not listed above will be
         based on the lowest noncontract hourly rate from
         Table 1...........................................
    (iii) Review of weighing (per hour per service                 79.20
     representative).......................................
(3) Stowage examination (service-on-request)\3\
    (i) Ship (per stowage space)...........................        51.00
    (Minimum $255.00 per ship).............................
    (ii) Subsequent ship examinations (same as original)
     (Minimum $153.00 per ship)
    (iii) Barge (per examination)                                  41.00
    (iv) All other carriers (per examination)                     16.00
------------------------------------------------------------------------
\1\ Fees apply to original inspection and weighing, reinspection, and
  appeal inspection service and include, but are not limited to,
  sampling, grading, weighing, prior to loading stowage examinations,
  and certifying results performed within 25 miles of an employee's
  assigned duty station. Travel and related expenses will be charged for
  service outside 25 miles as found in Sec.  800.72 (a).
\2\ An additional charge will be assessed when the revenue from the
  services in Schedule A, Table 2, does not cover what would have been
  collected at the applicable hourly rate as provided in Sec.  800.72
  (b).
\3\ If performed outside of normal business, 1-1/2 times the applicable
  unit fee will be charged.
\4\ If, at the request of the Service, a file sample is located and
  forwarded by the Agency for an official agency, the Agency may, upon
  request, be reimbursed at the rate of $2.50 per sample by the Service.


                   Table 3.--Miscellaneous Services\1\
------------------------------------------------------------------------
 
------------------------------------------------------------------------
(1) Grain grading seminars (per hour per $55.00 service           $55.00
 representative)\2\........................................
(2) Certification of diverter-type mechanical samplers (per        55.00
 hour per service representative)\2\.......................
(3) Special weighing services (per hour per service
 representative)\2\
    (i) Scale testing and certification....................        55.00
    (ii) Evaluation of weighing and material handling              55.00
     systems...............................................
    (iii) NTEP Prototype evaluation (other than Railroad           55.00
     Track Scales).........................................
    (iv) NTEP Prototype evaluation of Railroad Track.......        55.00
    Scales (plus usage fee per day for test car)...........       110.00
    (v) Mass standards calibration and reverification......        55.00
    (vi) Special projects..................................        55.00
(4) Foreign travel (per day per service representative)....       490.00
(5) Online customized data EGIS service
    (i) One data file per week for 1 year..................       500.00
    (ii) One data file per month for 1 year................       300.00
(6) Samples provided to interested parties (per sample)....         2.60
(7) Divided-lot certificates (per certificate).............         1.50
(8) Extra copies of certificates (per certificate).........         1.50
(9) Faxing (per page)......................................         1.50
(10) Special mailing (actual cost)
(11) Preparing certificates onsite or during other than
 normal business hours (use hourly rates from Table 1)
------------------------------------------------------------------------
\1\ Any requested service that is not listed will be performed at $55.00
  per hour.
\2\ Regular business hours-Monday through Friday-service provided at
  other than regular hours charged at the applicable overtime hourly
  rate.



[[Page 13089]]

Gerald E. Grinnell,
Acting Administrator, Grain Inspection, Packers and Stockyards 
Administration.
[FR Doc. 02-6835 Filed 3-20-02; 8:45 am]
BILLING CODE 3410-EN-U